All About Credit Card Debt Consolidations

If you have credit card debt you may have considered credit card debt consolidations as one of the solutions to get you out of the debt that you are in. Credit card debt consolidation is a common practice these days, and having to consolidate your credit card debt to make it manageable is nothing to be ashamed of. However, you should know, before you agree to massive fees and total control from one of the thousands of debt consolidation services out there, that debt  consolidation for credit cards is something that you can do yourself if you know how to approach the credit card companies. We’ll show you a few tricks here to make negotiating with creditors easier.

Consolidating credit card debt is a method of combining your debt into one lower monthly payment, with reduced interest and fees. Normally, when you use a company to consolidate credit card debt, they simply explain the situation to creditors and use various methods to get them to reduce the interest, drop some fees or simply allow you more time to pay the debt off. This is a fairly simple practice and doesn’t require any special training. In fact, in some states these companies aren’t licensed or even monitored by the government.

One of the best methods for eliminating your credit card debt without any additional consequences, is to get a credit card debt consolidation loan. This type of loan allows you leverage to negotiate, because you have the money to pay off the debt in full. Many times, a company will report to the credit bureaus if they know that you are going to be late with your payments because of debt consolidation, but with a loan this need not be the case. You don’t have to tell them that you are trying to consolidate your debt, just that you want to pay off the loan.

First of all, when you call the companies, whether you have a loan or not, explain that you are trying to get rid of your debt as quickly as possible, and don’t mention anything about debt consolidation. Say something along the lines of, ‘you want your money in full, and I want to pay this credit card off as quickly as possible, is there anything we can do about late/over limit/overdraft/cash advance/etc fees to reduce the amount that I’m paying so that I can make sure my budget allows me to pay you off in a timely manner.

This method allows you to attempt to reduce the interest or fees to make monthly payments. Hopefully, you’ll be able to negotiate with many of your creditors in order to get a lump sum that is much lower than the original sum of payments. However, you can often get what is called a cash settlement. That is, you pay in cash, the entire amount of the loan, and they agree to reduce it to X amount. This method gives you a lot of power when it comes to negotiating, because you will be able to pay it off that very day, and therefore can negotiate for a much lower settlement amount.